HBA-JLV H.B. 2833 77(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 2833
By: Grusendorf
Ways & Means
4/5/2001
Introduced



BACKGROUND AND PURPOSE 

Current law does not explicitly exclude a non-attorney providing statutory
foreclosure services from being regarded as a provider of debt collection
services, which is considered a taxable event for state sales tax purposes.
Due to this ambiguity in current law, attorneys that are exempted from
paying sales tax could have a competitive advantage in providing
foreclosure services over non-attorneys offering the same services.  Many
would like to make it clear that a trustee, whether an attorney or a
non-attorney, will not be liable for sales tax in the trustee's role as a
fiduciary for both the borrower and lender when conducting a foreclosure
sale.  House Bill 2833 provides that debt collection service does not
include a service provided by a person acting as a trustee in connection
with the foreclosure sale of certain property. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

ANALYSIS

House Bill 2833 amends the Tax Code to provide that debt collection service
does not include a service provided by a person acting as a trustee in
connection with the foreclosure sale of real property under a lien created
by a mortgage, deed of trust, or security instrument. 

EFFECTIVE DATE

July 1, 2001, or if the Act does not receive the necessary vote, the Act
takes effect October 1, 2001.